Tesco Agrees Deal For Dobbies Garden Centres

Fri, 08 Jun 2007
 
Get the latest prices, codes, vouchers & deals fortnightly.
Tesco is set to expand its retail empire by making a £155 million offer to acquire Scotland's Dobbies Garden Centres .

The supermarket giant, already the largest in the UK, plans to create a national chain for Dobbies and intends to fulfil customers' green aspirations through the garden centre market.

Its £155.6 million offer, a price of 1,500p-per-share in cash, has been backed by management, although it is understood that Apax, the private equity firm, along with others had also held talks with the garden centre group. Tesco's move took many by surprise as it represented a departure from its core brand and business .

However the chain's UK growth is courting ever more controversy amid growing concerns about its dominance of the grocery market.

Tesco chief executive Sir Terry Leahy commented, "The increasing popularity of gardening and the trend towards eco friendly products makes this an attractive sector for Tesco to invest in."

"Tesco has a proven track record of growing businesses, product innovation and improving our offer to customers internationally," he added.

Dobbies chairman Alex Hammond-Chambers said, "We are recommending the Tesco offer because we feel it is an excellent deal for Dobbies shareholders, customers and staff and because a stronger and better business can be built as part of the Tesco group."

"Together, we can develop our store portfolio, supply chain, systems and online business and, over time, offer customers a wider range of products at keener prices," added the chairman.

Tesco said it believes Dobbies has the best garden centre business model in the UK and the acquisition will also create a significant number of jobs .

At present Dobbies currently has 21 stores, mainly based in Scotland, and Tesco plans to expand that to 100 stores nationwide, while the retailer added that the current management and the 140-year-old Dobbies brand would remain in place.

Link to this page

Copy and Paste the following HTML into your page.